Islamic Finance and International Commercial Law: A Comparative Socio-Legal Analysis of Regulatory Frameworks in Islamic and Western Legal Systems

Abstract

The accelerated evolution of digital technologies has fundamentally reshaped international trade by fostering the growth of digital marketplaces and platform-based business models that enable seamless cross-border electronic transactions. Although these platforms have increased market accessibility, enhanced commercial efficiency, and broadened consumer choice, they have simultaneously generated complex legal and regulatory challenges. Online consumers frequently encounter issues such as deceptive advertising, inadequate disclosure of product information, unfair contractual provisions, misuse of personal data, and limited access to effective remedies in cross-border disputes. To address these concerns, jurisdictions across the world have introduced legal and regulatory measures designed to strengthen consumer protection and promote fairness within the digital economy. Against this backdrop, the present study undertakes a comparative socio-legal examination of consumer protection in digital marketplaces by analysing e-commerce regulation within Islamic and Western legal traditions. The research adopts a qualitative doctrinal and comparative legal approach to investigate the legal principles governing electronic commerce, consumer rights, and mechanisms for resolving disputes in both legal systems. Particular attention is given to the foundational concepts of Islamic commercial law, including justice, transparency, mutual consent, and the prohibition of exploitative practices, and these principles are compared with the statutory and regulatory frameworks that characterize Western consumer protection regimes. In addition, the study evaluates the broader socio-legal dimensions of digital commerce by examining how institutional arrangements, cultural values, technological innovation, and regulatory enforcement shape the effectiveness of consumer protection in online marketplaces. The analysis reveals that, despite differences in legal philosophy and regulatory design, both Islamic and Western legal systems pursue comparable objectives in safeguarding consumers and ensuring equitable commercial practices. Western jurisdictions predominantly rely on comprehensive legislative frameworks, specialised regulatory authorities, and judicial enforcement to protect consumer interests. In contrast, Islamic commercial jurisprudence combines legally binding rules with ethical and moral principles that encourage honesty, accountability, and fairness in market transactions. Nevertheless, both traditions share a commitment to preventing fraud, ensuring transparency, promoting contractual fairness, and protecting consumers from commercial exploitation. The study concludes that the increasing globalisation of digital commerce necessitates stronger international cooperation and greater harmonisation of legal standards to overcome the regulatory challenges posed by cross-border electronic transactions. Enhancing transparency obligations, strengthening online dispute resolution mechanisms, improving personal data protection, and reinforcing platform accountability are essential for ensuring effective consumer protection in digital marketplaces. Furthermore, incorporating ethical values drawn from diverse legal traditions into contemporary regulatory frameworks can contribute to the development of a more balanced, inclusive, and sustainable system of digital commerce that supports innovation while preserving consumer rights and market integrity.